How Did Canada’s Deficit Shrink So Much?

The Canadian government on Monday shed more light on how it was able to shrink its budget deficit at a faster-than-expected pace in its latest fiscal year. In a nutshell, higher revenue and lower expenses did the trick.

Prime Minister Stephen Harper told a suburban Toronto business crowd last Thursday that the deficit for the fiscal year ended March 31 was 5.2 billion Canadian dollars ($4.57 billion), well below the 2014 budget plan forecast for a C$16.6 billion deficit.

Canada’s Finance Department, in its annual financial report released Monday, confirmed the deficit figure Mr. Harper cited, or C$5.15 billion to be precise. It also offered an explanation for the smaller deficit figure.

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